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GalinKa [24]
2 years ago
14

An asset is purchased on January 1 for $44,700. It is expected to have a useful life of five years after which it will have an e

xpected residual value of $6,000. The company uses the straight-line method. If it is sold for $32,000 exactly two years after it is purchased, the company will record a: Multiple Choice
Business
1 answer:
Black_prince [1.1K]2 years ago
5 0

Answer:

Gain of $2,780

Explanation:

Calculation to determine what The company will record If it is sold for $32,000 exactly two years after it is purchased

First step is to calculate the Annual depreciation expense using this formula

Annual depreciation expense = (Cost − Residual value) × (1 ÷ Useful life)

Let plug in the formula

Annual depreciation expense = ($44,700 − $6,000) × (1 ÷ 5)

Annual depreciation expense =$38,700× (1 ÷ 5)

Annual depreciation expense =$ 7,740

Second step is to calculate the Accumulated depreciation using this formula

Accumulated depreciation = Year 1 depreciation expense + Year 2 depreciation expense

Let plug in the formula

Accumulated depreciation = $7,740 +$7,740

Accumulated depreciation = $15,480

Now let calculate the Gain (loss) on disposal

Using this formula

Gain (loss) on disposal = Proceeds from sale − (Cost − Accumulated Depreciation at time of sale)

Let plug in the formula

Gain (loss) on disposal = $32,000 − ($44,700 − $15,480)

Gain (loss) on disposal =$32,000-$29,220

Gain (loss) on disposal=$2,780

Therefore If it is sold for $32,000 exactly two years after it is purchased, the company will record a GAIN of $2,780

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Answer:

When shares are repurchased, they are recorded at the cost price in the books which means that they will be recorded at:

= 100 * 40

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Cash will then be credited because assets are credited when they reduce.

Treasury stock will be debited to show that Equity is reducing.

Date                       Account Title                                 Debit                  Credit

June, 30                Treasury Stock                            $4,000

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7 0
2 years ago
When more than one central bank attempts to shift the equilibrium exchange rate, we refer to this as:?
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<span>When more than one of more of the central banks try to shift the exchange rates it is referred to as a market shift. These market shift occur periodically based on inflation and interest rates.</span>
8 0
3 years ago
Miguel Corporation, a foreign subsidiary of a U.S. parent company, has one asset (Land) and no liabilities. The functional curre
user100 [1]

Answer:

All the 4 statements are correct.

Explanation:

The International Accounting Standard on Currency changes says that the all the assets and liabilities of the subsidiary must be reported at market value of the asset both at the end of the year and at the time of sale of asset & payment of liability. So this means that the statement a and d are correct statements because the translation gain or loss is reported by using the spot rate which is the market value of the asset in the parent company's currency. Similarly, the statement b and c are correct because at the time of sale of subsidiary assets we are actually recognizing the remeasurement gain or loss by using the spot rate, which is the market value of the asset in the parent company's currency.

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Pumpkin Inc. sold $500 in pumpkins to a customer on account on January 1. On January 11 Pumpkin collected the cash from that cus
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The simple interest rate is 7% per year. if james deposits 10,000 at the end of 18 months coursehero
monitta

Deposit (PV): $10,000

Years between the 18th month and the fifth year (n) = 3.5

(I)=7% yearly interest rate

Simple interest approach accumulated value equals P*(1+(i*n)).

=1000*(1+(7%*3.5))

=1245

Thus, the total value at the end of five years will be $1245.

Compound interest method accumulated value equals P*(1+i)n

=1000*(1+7%)^3.5

=1267.19

Therefore, the total value after five years will be $1267.19.

Learn more about simple interest here ;

brainly.com/question/25845758

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4 0
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